Correlation Between Bank Mandiri and Penn National
Can any of the company-specific risk be diversified away by investing in both Bank Mandiri and Penn National at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Bank Mandiri and Penn National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank Mandiri Persero and Penn National Gaming, you can compare the effects of market volatilities on Bank Mandiri and Penn National and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Bank Mandiri with a short position of Penn National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank Mandiri and Penn National.
Diversification Opportunities for Bank Mandiri and Penn National
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bank and Penn is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Bank Mandiri Persero and Penn National Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Penn National Gaming and Bank Mandiri is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Bank Mandiri Persero are associated (or correlated) with Penn National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Penn National Gaming has no effect on the direction of Bank Mandiri i.e., Bank Mandiri and Penn National go up and down completely randomly.
Pair Corralation between Bank Mandiri and Penn National
Assuming the 90 days horizon Bank Mandiri Persero is expected to under-perform the Penn National. In addition to that, Bank Mandiri is 4.82 times more volatile than Penn National Gaming. It trades about -0.16 of its total potential returns per unit of risk. Penn National Gaming is currently generating about 0.08 per unit of volatility. If you would invest 2,016 in Penn National Gaming on November 28, 2024 and sell it today you would earn a total of 56.00 from holding Penn National Gaming or generate 2.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Bank Mandiri Persero vs. Penn National Gaming
Performance |
| Timeline |
| Bank Mandiri Persero |
| Penn National Gaming |
Bank Mandiri and Penn National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank Mandiri and Penn National
The main advantage of trading using opposite Bank Mandiri and Penn National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank Mandiri position performs unexpectedly, Penn National can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Penn National will offset losses from the drop in Penn National's long position.| Bank Mandiri vs. HDFC Bank Limited | Bank Mandiri vs. China Merchants Bank | Bank Mandiri vs. China Merchants Bank | Bank Mandiri vs. Fifth Third Bancorp |
| Penn National vs. DraftKings | Penn National vs. MGM Resorts International | Penn National vs. Caesars Entertainment | Penn National vs. Boyd Gaming |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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